How can Korea Raise its Future Potential Growth Rate?

Korea has achieved tremendous economic progress over the last three and a half
decades, but in recent years growth has slowed down, and looking forward, most
forecasters expect potential growth to decline substantially. The authors’ analysis
of the key factors determining potential growth in Korea suggests that only if
Korea implements swift reforms to address the low productivity of its service
sector and prevent the decline in its labour supply, can the Korean economy
achieve a doubling of its per capita income level by 2020. Without a rapid
response this goal will be unachievable and the expected growth slowdown will
be unavoidable. Reforms intended to boost productivity in services and labour
force participation could help Korea sustain growth at double its expected real
growth rate in the business-as-usual scenario in the period 2020–40.